Small to mid-sized business owners can breath a sigh of relief or at least until January 1st, 2015. The Obama administration has recently announced that small businesses will have a one year grace period to comply to the new health insurance requirements as part of the Affordable Care Act. What does this mean for your business?

Healthcare penalties delayed one yearThe government will now delay collecting fines for businesses with 50 or more full-time or full-time equivalent employees that fail to meet the health insurance requirements. The $2,000 penalty per employee for failure to provide health insurance will still be in effect, but not until January 1st, 2015.

What about the online healthcare exchanges?According to the U.S. Department of Health and Human Services, the exchanges remain on track to launch by the October 1st, 2013 deadline. However, there has been chatter among politicians and a report by the Government Accountability Office (GAO) indicating that the exchanges are behind schedule in terms of enrollment, plan schedules and customer service assistance. Therefore, we are somewhat skeptical that the exchanges will launch on time. Still, eventually the exchanges will go into effect. When this occurs states will have setup Small Business Health Option (SHOPs) programs, which would allow those with less than 100 employees to have the option to buy health insurance as a group. The Congressional Budget Office estimates that this new marketplace will lower health care costs by 1% to 4%.

How beneficial is the delay to businesses?The vast majority of small businesses are not impacted at all from this recent announcement to delay the penalty until January 1, 2015. Over 90% of small businesses have less than 50 full-time employees. It’s the small to mid-sized businesses that are near, at or above the 50 full-time employee floor that will benefit. This can be very beneficial to businesses that were planning on cutting the number of their staff below 50.